And, on the contrary, there is a whole _catena_ of authorities, beginning with Sir Robert Peel and ending with Mr.Lowe, which say that the Banking Department of the Bank of England is only a Bank like any other bank--a Company like other companies; that in this capacity it has no peculiar position, and no public duties at all.

Nine-tenths of English statesmen, if they were asked as to the management of the Banking Department of the Bank of England, would reply that it was no business of theirs or of Parliament at all; that the Banking Department alone must look to it.
The result is that we have placed the exclusive custody of our entire banking reserve in the hands of a single board of directors not particularly trained for the duty--who might be called 'amateurs,' who have no particular interest above other people in keeping it undiminished--who acknowledge no obligation to keep it undiminished who have never been told by any great statesman or public authority that they are so to keep it or that they have anything to do with it who are named by and are agents for a proprietary which would have a greater income if it was diminished, who do not fear, and who need not fear, ruin, even if it were all gone and wasted.
That such an arrangement is strange must be plain; but its strangeness can only be comprehended when we know what the custody of a national banking reserve means, and how delicate and difficult it is.
II.
Such a reserve as we have seen is kept to meet sudden and unexpected demands.

If the bankers of a country are asked for much more than is commonly wanted, then this reserve must be resorted to.

What then are these extra demands?
and how is this extra reserve to be used?
Speaking broadly, these extra demands are of two kinds--one from abroad to meet foreign payments requisite to pay large and unusual foreign debts, and the other from at home to meet sudden apprehension or panic arising in any manner, rational or irrational.
No country has ever been so exposed as England to a foreign demand on its banking reserve, not only because at present England is a large borrower from foreign nations, but also (and much more) because no nation has ever had a foreign trade of such magnitude, in such varied objects, or so ramified through the world.

The ordinary foreign trade of a country requires no cash; the exports on one side balance the imports on the other.